Euro Bulls Are Getting Carried Away

By

Nicholas Hastings

Sep 17, 2012 6:23 am EST

Standing in front of the stampeding euro bulls is futile, if not downright dangerous. But, that doesn’t mean the bulls are right.

The latest stampede started when the European Central Bank announced its bond buying program the week before last, and then really gathered momentum after the U.S. Federal Reserve announced the introduction of unlimited quantitative easing last week.

The first move by the ECB raised hopes that the single currency will now be saved, and the second by the Fed raised risk appetite as the chances of a global economic recovery improved.

Additional fuel for the stampede came from the ruling by the German constitutional court that the euro’s bailout funds are legal and from Dutch elections showing that support for the single currency is stronger than expected.

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com.